mm2 Asia - DBS Research 2017-01-11: New Group CEO appointed to boost management team

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MM2 ASIA LTD. 1B0.SI

mm2 Asia - New Group CEO appointed to boost management team

• New Group CEO Mr Chang Long Jong is a veteran in the media industry.
• Mr Melvin Ang to focus on North Asia, a key growth area for mm2 Asia.
• Reiterate BUY call with TP of S$0.56.

New Group CEO appointed 

• mm2 Asia announced the appointment of Mr Chang Long Jong as its new Group Chief Executive Officer with effect from 3 April 2017.
• As the CEO of the company, Mr Chang will be responsible for overseeing and managing the business operations, especially the production division as well as sourcing new business opportunities for the group. 
• Prior to Mr Chang joining the company, Mr Melvin Ang Wee Chye will continue to be the CEO until Mr Chang’s appointment takes effect.

Mr Chang Long Jong is a veteran in the media industry 

• Mr Chang Long Jong is currently the Deputy CEO and Chief Customer Officer of Mediacorp Pte Ltd. He oversees all of Mediacorp’s major media assets including TV, Radio, Newspaper, Magazines and Over-the-Top (OTT) service Toggle. In his 30- year career since joining Singapore Broadcasting Corporation in 1985, Mr Chang has gathered experience in channel management, content development and production, content licensing and distribution, media business development and talent management. He also leads Mediacorp’s events business, Vizpro and Mediacorp’s media training business, Singapore Media Academy.

Mr Melvin Ang to focus on North Asia, a key growth area for mm2 Asia 

• With Mr Chang coming on board, Mr Melvin Ang, who is currently the Executive Chairman, CEO and Executive Director, would be able to focus his attention on the burgeoning North-Asia market, which is crucial for mm2’s next phase of growth. 
• In terms of its core production business, we expect North Asia, including China, Hong Kong and Taiwan, to contribute > 70% of core revenue from FY17F, up from 23% in FY16. 
• Growth opportunities in North Asia, especially China, are abundant. Furthermore, given the much bigger budget in China, it is more attractive to produce more films in China than in Singapore and Malaysia. A typical production in China costs about RMB30m-50m, versus S$1m-3m in Singapore and RM1m- 3m in Malaysia. However, the duration of each production is quite similar across the region.
• We reiterate our BUY call on mm2 Asia with TP of S$0.56.

Lee Keng LING DBS Vickers | http://www.dbsvickers.com/ 2017-01-11

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